Frederick Winslow Taylor's contributions to cost accounting

1

Rosita S. Chen and
Sheng-Der Pan
CALIFORNIA STATE UNIVERSITY, FRESNO
FREDERICK WINSLOW TAYLOR'S CONTRIBUTIONS TO COST ACCOUNTING
Abstract: This article is to introduce the cost accounting system that Frederick Winslow Taylor installed at the Tabor Manufacturing Company sometime in the 1890s. A comparative analysis between this system and Captain Henry Metcalfe's Cost of Manufactures is also made in order to investigate their sources and in-fluences. It is concluded that Taylor was a pioneer in many aspects of cost accounting, but his most important contribution was the development of the managerial approach that paved the way for modern managerial accounting.
In the later stages of the Industrial Revolution, businessmen were under increasing competitive pressure and were, therefore, striving to improve their managerial efficiency. It was largely in response to this drive for efficiency that Frederick W. Taylor (1856-1915) pursued the study of scientific management. Realizing that efficient managers require timely, complete, and accurate account-ing information, he devoted a great part of his time to studying accounting in the 1880s. Following the widespread acceptance of scientific management, his methods of cost accounting became popular. This popularity lasted at least up until the 1920s.
Accounting history has not done justice to Taylor's contributions. This is probably because he had little interest in publicizing or claim-ing credit for the originality of his bookkeeping and costing systems. Nevertheless, an introduction to his work in cost accounting serves a valuable purpose. For one thing, it provides better understanding of his system of scientific management in general. It also helps identify Taylor's role in the development of industrial accounting and thereby bridges a historical gap in an important period of modern industrialization.
Acknowledgement is made to Dean V. K. Zimmerman and Professor R. I. Dickey of the University of Illinois, Dean Emeritus Paul Garner of the University of Ala-bama, and the anonymous reviewers of this paper for their comments and en-couragement. Great appreciation is extended to the Stevens Institute of Technology for the use of the Taylor Collection, without which this paper would have been impossible.